TERMS OF REFERENCE

Project Title:
Support to the Development of the State Registration System of Legal Person and Natural Persons – Entrepreneurs

1.	Background Information
1.1.	Beneficiary country 
Ukraine

1.2.	Contracting authority
European Community, represented by the Commission of European Communities.

1.3.	Local applicant 
State Committee of Ukraine for Regulatory Policy and Entrepreneurship (SCURPE),
9/11, Arsenalna Street, Kyiv, 01011, Ukraine   
Tel. +380-44/ 216-98-82, 216-47-77;   fax:+380 44/ 216–61-43. 
SCURPE was created in the course of administrative reform in May 2000 with the aim to promote the development of entrepreneurship. It coordinates regulatory activities in the sphere of business start-up (registration, licensing, issue of permits), implements the state policy in the sphere of entrepreneurship.

1.4.	Current state of affairs in the relevant sector and project background
The Ukrainian state registration system of legal persons and natural persons – entrepreneurs consists of local executive authorities and local governments (direct registration institutions), the State Committee of Ukraine for Regulatory Policy and Entrepreneurship (central body specially authorized on registration issues) and its 27 regional Representative Offices in oblasts, Autonomous Republic of Crimea, cities of Kyiv and Sevastopol.
Present system of registration (re-registration, alterations and cessation, etc.) is characterized by the following features:
a)	high number of registration bodies – 749, 510 of which are district state administrations and 239 are executive committees of local governments (i.e. the registration is conducted by two branches of power on local level); 
b)	availability of personnel (almost 2000 state registrars) to be trained in new registration procedures;
c)	no unified database of registered business agents;
d)	the function of methodological support and control of registration of business agents is delegated to SCURPE.
In order to eliminate the current registration system shortcomings the SCURPE has elaborated the Law of Ukraine “On State Registration of Legal Persons and Natural Persons – Entrepreneurs” (adopted by the Parliament on the 15th of May, 2003) that comes into effect on the 1st of July, 2004. This law deals with the following:
1)	simplification of all steps and procedures of registration and adjustment of the relations in this sphere by the direct action law (before the state registration system was regulated by a number of indirect laws, notably “On Business Organizations”, “On Entrepreneurship”, “On Enterprises” etc.);
2)	application of the registration procedure on base of the “one stop shop” principle and introduction of electronic registration;
3)	establishment of absolutely new for Ukraine institution of professional registrars of business agents– institution of State Registrars;
4)	creation of the Unified State Register of Legal Persons and Natural Persons – Entrepreneurs of Ukraine with free access to its database;
5)	publication of a special printed edition containing the information from the Unified State Register.
But there are still some problems in registration system: 
•	Ukrainian legislation is not fully harmonized with that of the European Union (in particular, regulatory documents); 
•	state registrars are not trained to conduct registration according to new procedures and not prepared to work with the Unified State Register;
•	restrictions in financial resources of the state budget; 
•	lack of costing policy for accessing company details for information (free access to database by the law to check registered companies but any registered company details for commercial purposes is to be available for a fee); 
•	lack of experience in information transfer of state register data.
Every European country has its own register of business agents. In order to integrate into the European informational space, avoid creation of paper companies, fight against terrorism and “money laundering” etc., Ukraine should have its own similar register, guarantee comprehensive and authentic information on business agents and give free access to it. 
The SCURPE has made some steps in this course, in particular created the software for the Unified State Register of Legal Persons and Natural Persons – Entrepreneurs of Ukraine, which was tested in Odessa oblast during 2003.
At the same time insufficient knowledge of European registration systems gives limited opportunities for integration of the informational resources of the Ukrainian State Register to the European Register “BUSINESS”.

1.5.	Related programmes
The present project should be considered as a complementary effort in line with the following provisions of National Indicative Programme 2002-2003:

“1.1	Legal, Judicial and Administrative Reform
Main Objective 
•	To adapt public institutions and the judiciary to the requirements of a democracy and a market economy. 
Specific Objectives 
•	To strengthen the capacities of central and regional Ukrainian authorities to implement economic and social reforms;
2.1 	Business, Trade and Investment Promotion
•	Demand- and market-oriented SME support programmes, including advanced business development services, implementation of favourable regulatory policies and facilitated access to micro-finance.
Support to SME development will be conditional upon improvements in the legal and regulatory framework, particularly in the field of taxation and registration.”
The project “SME Support Services in Priority Regions” is planned to be implemented under the National Action Programme 2003. Main objectives of the project are: to contribute to the development of a policy environment and administrative culture supportive of SME growth in targeted priority development regions; to promote improved access to, and use of, business consultancy advice by SMEs; to introduce more strategic conceptions both for businesses and support services. The project will start not earlier than in the end of the year 2004.
Unlike the above project concentrated in specific regions the proposed project will be nationwide and will be focused on the regulatory function of the SCORPE, notably on state registration, licensing and permission systems. Besides, the activities planned under the present project should be implemented with a view of the urgent tasks to be accomplished: preparation to implementation and support to implementation of the Law of Ukraine on the State Registration of Legal Persons and Natural Persons – Entrepreneurs, which takes effect on the 1st of July 2004. Therefore, Bistro Programme seems to be the most adequate mechanism, taking into account time frame needed for all administrative procedures that precede the practical implementation of the project.

2.	Project objectives
2.1.	Project description
The Project is focused on assisting the development of the state registration system of business agents and will support the implementation of Law of Ukraine “On State Registration of Legal Persons and Natural Persons – Entrepreneurs”, give practical recommendations on the further harmonization of the Ukrainian legislation in this sphere with that of the European Union and identify specific measures towards informational integration with the European registration systems.

2.2.	Project specific objectives
•	Drafting regulatory documents on state registration of legal persons and natural persons – entrepreneurs;
•	Training and raising the professional skills of state registrars;
•	Defining the terms and rules of access to the database of State Register.

2.3.	Results
•	A set of regulatory documents that meets the requirements of respective European Council Directives elaborated and prepared for adoption by the Ukrainian Government or for registration in the Ministry of Justice of Ukraine;
•	Direct training of about 900 state registrars (of 749 public authorities that were entrusted with the right of registration) on implementation of provisions of Law on Registration and on operation with the State Register conducted;
•	Methodological recommendations on organisation of work on state registration of legal person and natural persons – entrepreneurs and access to the database of the State Register elaborated;
•	Contacts developed with EU Member States in order to organise the exchange of information with each state register organisations.
•	Unification of registration database under Oracle from different existing databases programmed in C, C++, SQL, Fox Pro and other languages/software.
3.	Scope of the work
3.1.	General
Expected benefit of the project implementation is a deeper harmonization of the Ukrainian legislation in the sphere of registration with that of the European Union and creation of conditions for information exchange between the Unified State Register of the Legal Persons and Natural Persons – Entrepreneurs of Ukraine and European registers. Furthermore adjustment of the registration system (which is considered as a barrier for business start-up) will have a positive impact on the general development of entrepreneurship. Besides, the Ukrainian entrepreneurs will benefit directly from the increased credibility effected by the transparency of data on the Ukrainian business subjects.
Interim target groups of the project are:
•	the SCURPE officials and state registrars (2000 persons);
•	personnel of private legal firms and public associations of entrepreneurs that provide services on registration.

3.2.	Specific activities
Task №1. To elaborate the set of draft regulatory documents concerning the implementation of the Law of Ukraine “On State Registration of Legal Persons and Natural Persons – Entrepreneurs”.
Those draft documents have to be discussed with state registrars (during their training) and other experts. The end result must be their adoption by the Government of Ukraine or registration in the Ministry of Justice of Ukraine.
Task №2. To elaborate the training plan of state registrars and personnel of firms providing services on preparation of documents for registration.
The detailed plan of training of the state registrars must include the following themes: preparation of the documents for registration, handling registration procedures and practical skills of work with the Unified State Register.
Task №3. To provide methodological and organisational support of training in nine identified regions, together with the experts of SCURPE.
•	The experience of the European registration systems of business agents must be presented as well as how to access informational resources of the European countries registration systems.
•	Training must be supported by distribution of the printed informational materials concerning draft and effective regulatory documents.
•	The project will bear the costs of renting premises for nine seminars with each time:  about 100 participants, over two days and in each selected nine regions.

Task №4. To define the terms and rules of access to database of the Unified State Register of the Legal Persons and Natural Persons – Entrepreneurs of Ukraine,
This task also includes development of practical recommendations on the data communications protocol with the European countries registers, advice on quantity and quality of the Register’s menu, and consultations on copyrights for respective intellectual property, training of IT personnel.
Task №5. To search for European companies that are interested in cooperation with SCURPE and negotiate with them on informational transfer of the State Register data. 

3.3.	Project management
The Tacis Operations Section of the Delegation of the European Commission to Ukraine will govern the implementation of the project. 
The Project Partners are the State Committee of Ukraine for Regulatory Policy and Entrepreneurship (Kyiv) and its regional Representative Offices. 
The SCURPE will provide the Project team with the office premises with telephone line and possibility of access to national and international networks. 

4.	Logistics and timing
The main base for the Project execution will be located in Kyiv (main office of the SCURPE).
A short-term contribution of the Project will be also made in Dnipropetrovsk, Ivano-Frankivsk, Lugansk, Lviv, Odesa, Kharkiv oblasts, the Autonomous Republic of Crimea, cities of Kyiv and Sevastopol.
The intended period of execution is 12 months. 

5.	Requirements 
5.1.	Personnel 
We use “he” for description of functions, while candidates can be of any sex. 
Key experts.
Key experts №1 will take part in elaboration of draft regulatory documents concerning the registration of business agents in line with European legislation. He must have a consultancy experience in adaptation to the requirements of European Council Directives concerning the registration of businesses; he must have an experience of similar project execution in European Union. He will take part in carrying out tasks №1-3 with full duration of not less than 100 days. Fluency in English is an absolute requirement, knowledge of Russian or Ukrainian will be considered as an advantage.
Key expert №2 must have practical skills in development of databases (Oracle), commercialization and transfer of informational technologies; he must know the European registration system of business agents. He will work on task № 3 with minimal duration of 100 days. Fluency in English is an absolute requirement, knowledge of Russian or Ukrainian will be considered as an advantage.
Non-key experts.
Non-key expert №1 must have high education and practical skills in Ukrainian legislation on registration and on creation of legal persons of different types. This expert will deal with the intellectual property rights issues related to the Oracle database. There are no special requirements on language skills.
Non-key expert №2 must have high education and practical skills in work with databases (Oracle). There are no special requirements on language skills. 
Non-key expert №3 must have a higher education and practical skills in Ukrainian legislation in the sphere of external economic relations. There are no special requirements on language skills.

6.	Reports
After the planned tasks are executed the performer submits the following documents in English, Russian and Ukrainian:

Task № 	Period of executing 
(by the end of period)	
Reporting documents	
-1-
Inception report
	1-st month 	•	description of training plan;
•	the list of draft regulatory documents to be  elaborated to ensure implementation of the Law of Ukraine “On State Registration of Legal Persons and Natural Persons – Entrepreneurs”.	
-2-
(Tasks
№№ 1, 2)	3-rd month	•	report on training conducted in regions;
•	report on draft regulatory documents on implementation of the Law of Ukraine “On State Registration of Legal Persons and Natural Persons – Entrepreneurs” worked through with the ministries and other central bodies.	
-3-
(Tasks 
№№ 1, 2)	6-th  month 	•	report on training conducted in regions;
•	report on regulatory documents adopted by the Ukrainian Government  and registered in the Ministry of Justice of Ukraine 	
-4-
(Tasks 
№ 1, 2, 3)
	9-th  month	•	report on training conducted in regions;
•	recommendations on methodology of work of the Unified State Register
•	recommendations on intellectual property rights protection of the software and the informational fund of the State Register;
•	a list of European companies that are interested in work with the SCURPE in the sphere of information exchange from the Unified State Register of the Legal Persons and Natural Persons – Entrepreneurs of Ukraine;	
-5-
(Tasks
№ 1)	12-th month	•	recommendations on the legislative documents that should be adjusted in accordance with the European legislation;
	
-6-
Final report
	12-th month	•	Final report that includes all above mentioned with corrections /recommendations (in case of necessity).